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Home » Accounting Resources » Accounting Fundamentals » Quality of Conformance

Quality of Conformance
Article by Reviewed by
Pranjal Jain Dheeraj Vaidya, CFA, FRM

Quality of Conformance Definition

Quality of Conformance can be defined as a quality management
terminology that measures the value/ amount or any other measuring
factor by which the developed product, service provided, or even the
manufacturing/ service providing system achieves quality targets or
deviates from the set standards, benchmarks or any other guidelines of
operation which can be classified into four major criteria like minor, major,
critical, serious or any other such similar classification.

Table of contents

Quality of Conformance Definition

Explanation

Example

Factors Affecting Quality of Conformance

Benefits

Conclusion

Recommended Articles

Explanation
Manufacturers of the products and services set and develop certain
evaluation points and benchmarks for their goods manufactured based
on factors like experience, customer requirements, etc. These setpoints
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and benchmarks work as the level of expectation for which the products
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and services against which finished products will be compared for
identifying deviations. If the targets are achieved, i.e., they meet the
specified requirements, then the product has excellent conformance
quality. And suppose the product does not meet the required points and
deviates highly from the proposed benchmarks and designs. In that case,
the product has a poor conformance quality as it is impossible to meet
the level of expectation exactly, so the manufacturers follow a tolerance
policy. This tolerance policy clarifies how much deviation is allowed for
the product from the expected standards and to be accepted.

Example
Justin is the proprietor of cab services in Miami. His business requires
picking up guests from the airport and leaving them at their desired
locations. In the hurdle of business becoming the top cab service
provider in Miami, he wants to increase the number of pickups and wants
his cabs to be available at the airport during peak hours. Drivers are
provided with their daily schedule, which clearly states each driver’s duty
timing schedule and their respective car. Since no one knows the traffic
and future, delays on roads are expected. So Justin allows leverage of +
or – 15 minutes.

Yesterday there was a pickup time of 2:05 PM. However, due to road
traffic, drivers couldn’t arrive at the airport until 2:16 PM. Since the driver
couldn’t make up with the expected time and missed his arrival time, it is
acceptable as he was there in the leverage time. So his quality of
conformance is not shattered and is acceptable. However, if he had
reached the airport after 14:20, this would have called attention to
determining the reason for deviation as it crossed leverage time of + 15
minutes.

Factors Affecting Quality of Conformance

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Market – A market is a place where goods and services are exchanged

based on the supplier’s requirements, customers, etc. A customer asks
for his requirements with his buying capacity that determines
conformance quality.

Materials – To manufacture a product and fulfill market needs, one

needs raw materials. The availability of adequate material is crucial for
sustaining the quality of conformance of final goods. The market is full
 of available materials with different specifications, but what is
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important is to choose the perfect material which completes the needs
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of the product at the optimum level of satisfaction with all
specifications.

Technology – It is essential to choose advanced technology and

machinery as it directly impacts the quality of conformance. Today’s
technology plays a vital role in saving costs and providing the best
results with minimum or no wastage.

Labor – Choosing efficient and skilled labor is vital as their experience

and knowledge will greatly impact goods produced or services rendered
to maintain the quality of conformance. Trained and capable labor will
help in better designing and manufacturing new products.

Cost – With the growing competition in the global market, it is

necessary to manufacture products and provide services at the lowest
possible cost. Money is the deciding factor in the quality of
conformance. The cost of maintenance and improvement has increased
in today’s world.

Management – The management decides the quality of conformance to

be maintained. Some managers give more importance to it while some
may not. Quality conformance programs should be organized and
supported by top management authorities.

On broader levels, it is factored from following –

Raw Material

Appropriate machines and tools

Process selection

Skilled labor and workforce

Transit and handling of materials

Feedback from customers.

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Ensuring Quality of0D 16H 12M 23S – As

Performance ENROLL
this isNOW
a checking and corrective
strategy, comparing finished products with set standards and identifying
deviations helps ensure better quality products reach the market.
Mistakes, once identified, will be rectified to rectify deviations which in
turn increases the quality of performance in the long run.

Increased Customer Satisfaction – Measuring products manufactured/

services provided with set standards to identify deviations helps
increase customer satisfaction as only refined products will be made
available to the customer. In case of deviations, products will undergo a
re-engineering phase to better ensure the quality of conformance.

Brand Value Development – Organizations following quality of

conformance will have a brand value and reputation in the market.

Cost Efficiency – As it ensures the quality of products delivered in the

market, it helps to ensure cost savings as only refined products are
allowed to enter the market, thereby reducing the chances of customer
dissatisfaction, warranty claims, and lawsuits.

Increased Marketability – Organization products or services enjoy

better marketability as customers develop trust in the quality of product
supplied by the entity.

Conclusion
Quality of conformance can be described as a plan, monitor, check and
act strategy in quality management theory. It specifies the level of non-
conformance of a particular product manufactured or services provided.
Management cannot always target to ensure zero non-conformance all
time, and therefore a certain level of deviations are allowed and ignored.
Overall, this concept helps ensure better quality products and service
delivery.
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Recommended Articles
This has been a guide to Quality of Conformance and its definition. Here
we discuss examples and factors affecting conformance quality and
benefits and differences. You may learn more about financing from the
following articles –

Cost of Quality

Quality of Earnings

Substitute Products

Purpose of An Audit
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